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Will Saudi Arabia Allow the US Oil Boom?

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This opinion piece presents the opinions of the author.
It does not necessarily reflect the views of Rigzone.

Technology, technology, and more technology—this is what has driven the American oil and gas boom starting in the Bakken and now being played out in the Gulf of Mexico revival, and new advances are coming online constantly. It's enough to rival the Saudis, if the Kingdom allows it to happen. Along with this boom come both promise and fear and a fast-paced regulatory environment that still needs to find the proper balance.

In an exclusive interview with Oilprice.com, Chris Faulkner, CEO of Breitling Energy Companies—a key player in Bakken with a penchant for leading the new technology charge—discusses:

  • How Bakken has turned the US into an economic powerhouse
  • What the next milestone is for Three Forks
  • What Wall Street thinks of the key Bakken companies
  • Where the next Bakken could be
  • What to expect from the next Gulf of Mexico lease auction
  • What the intriguing new 4D seismic possibilities will unleash
  • What the linchpin new technology is for explorers
  • How the US can compete with Saudi Arabia
  • Why fossil fuel subsidies aren't subsidies
  • How natural gas is the bridge to US energy independence
  • Why fossil fuels shouldn't foot the bill for renewable energy
  • Why Keystone XL is important
  • Why the US WILL become a net natural gas exporter

James Stafford: How important are Bakken and Three Forks to US energy in the big picture?

Chris Faulkner: The Bakken Shale has been the biggest driver in America's reversal of decades of decline in oil production. It has transformed North Dakota into an economic powerhouse with the nation's lowest unemployment rate and fastest-growing GDP—and an oil production level surpassing that of some OPEC nations. An added increment of almost 800,000 barrels per day of oil output, built in less than a decade, has helped the US reduce its dependency on oil imports from often hostile countries by 22% since peaking in the mid-2000s.

US oil production is at its highest level since 1992, and in another 5 years, it is projected to reach its highest level since 1972. More importantly, the US oil production surge will help tamp down the possibility of chronically recurring oil supply shortages and help keep a lid on oil price spikes for the foreseeable future. Additionally, the Bakken surge is helping to narrow the spread between WTI and Brent, providing even more economic incentive to develop the costly unconventional resource plays.

James Stafford: The US government recently more than doubled its estimates for Bakken and Three Forks to 7.4 billion barrels of undiscovered and technically recoverable oil and 6.7 trillion cubic feet of natural gas. How is the industry responding to this? How are investors responding?

Chris Faulkner: Some operators had already been developing the Three Forks formation ahead of the USGS revised estimate for the Greater Bakken play. That drilling in fact provided much of the knowledge about the Three Forks that led to the USGS upgrade. We're already seeing stepped-up drilling in the Three Forks, and some of that will entail dual horizontal laterals, a real milestone that could yield spectacular IP rates. Accordingly, Wall Street analysts are upgrading their guidance on companies such as Continental Resources that are leading the Bakken charge.


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WHAT DO YOU THINK?

Post a Comment Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Gary P. Olson, MBA, P.E. | Jun. 8, 2013
Excellent article, I appreciate the candor therein. I started doing "exotic" fracture stimulations in 1978. Never heard from the EPA. Designed exotic fluids for completions or recompletions. Again, nothing out of the EPA. I did inquire about the "bad" press. The answer was that the "press" just found out about fracture stimulations. The functional illiteracy of the press and the EPA should be a cause for much consternation within the industry.

Jan Arps | Jun. 7, 2013
An Excellent and very insightful review of some of the major issues facing the oil and gas industry today. Im saving this for future reference to address concerns raised by oil industry critics.

Floyd | Jun. 7, 2013
What can the Saudis do in the end? The need American defense, it is not likely that they are able to muster any influence with regard to our oil production.

Myrtle C | Jun. 6, 2013
And no, the US is not vulnerable to Middle Eastern Pricing Rigging, as we all can see Breitling Energy was the commentator and at the rate of exchange, though still remaining one of our Allies and NAFTA, the US has become more independent in Natural Resources and less foreign dependency, Boy, have we grown....Miss America, the Beautiful and God Bless America.



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